Venezuela international bonds extend rally after Maduro capture

LONDON, Jan 6 (Reuters) - Venezuela's ⁠international sovereign ⁠bonds ‍gained more than 2 cents on Tuesday, extending a rally from the previous session fuelled by ‍investor optimism following the U.S. capture of President ​Nicolas Maduro over the weekend.

The defaulted 2034 note notched some of the ​biggest gains, adding 2.5 cents to bid at 43.01 cents on the dollar, Tradeweb data showed. Some of the bonds rallied close to ​10 cents on Monday.

Bonds issued by state oil company Petroleos de Venezuela also gained, with the 2031 up ​2 cents to bid at 42.60 cents.

Many of the bonds trade at their ‌highest since before Donald Trump started his first term in January 2017, which marked the start ​of a sharp escalation of the ⁠U.S. sanctions regime against Caracas and saw Venezuela tip into sovereign default.

Bonds have rallied since ‌Trump started his second term in office in January 2025, with many notes nearly tripling in price, the gains fuelled by ‌hopes for a regime change in Venezuela, paving the way for ‌an eventual debt restructuring.

"We believe the outlook for debt restructuring may shift meaningfully, as expectations for the eventual recovery value of Venezuelan debt ‍have improved," Jared Lou, portfolio manager at William Blair Investment Management, said.

"If a credible and ⁠structured political transition occurs - potentially enabling U.S. companies to restart oil operations and enabling sovereign debt restructuring - Venezuelan bond prices could experience a sustained rally."

(Reporting by Karin Strohecker, editing by Libby George and Andrew Heavens)

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